If you’re wondering what a lifestyle business is, you’re in the right place!
So what is a lifestyle business exactly?
I’ve been educating myself about this type of business and how it works since 2013.
And, with the help of my wife, I’ve built one that you can read more about here.
It hasn’t made us rich.
But it does make us a modest living!
In short, I don’t have lifestyle businesses all figured out.
But I’m happy to share what I’ve learned researching them the past several years.
Lifestyle Business Vs. Growth Business or Regular Business
A lifestyle business differs from a standard business in that a lifestyle entrepreneur creates a business specifically to help him live his ideal lifestyle.
In other words:
Someone starting a standard business might launch their startup to change the world.
Or they might start a business because they believe it will lead to riches.
But a lifestyle entrepreneur starts a business to help him lead exactly the life he wants to lead.
Most standard business owners also have a growth-first mentality.
This means that if they can grow the top or bottom line, they will do so.
They will even grow their income if that means inconveniencing themselves or others.
However, a lifestyle entrepreneur may not pursue growth opportunities if it will lead to more work.
Or he may pursue slower growth opportunities to preserve his lifestyle.
This is why people like Elon Musk or Warren Buffet aren’t usually considered lifestyle entrepreneurs.
They may use their businesses to lead exactly the lives they want to lead.
However, most lifestyle entrepreneurs wouldn’t consider them lifestyle entrepreneurs because their focus seems to be profit maximization, growth, and/or changing the world.
Instead of these focuses, lifestyle entrepreneurs try to build specific types of businesses that allow them to work:
- alone (or mostly alone),
- whenever and wherever they want,
- and on something they enjoy.
In the next section, I’ll examine the sorts of business models best suited to be a lifestyle business.
Lifestyle Business Qualities: Leveraging Media and/or Software
Certain types of businesses allow the founder to work alone, on whatever he wants, whenever and wherever he wants better than others.
For instance, business models best suited for lifestyle businesses typically generate most of their income from either media or software (or both).
Bloggers, YouTubers, podcasters, and authors, often run their businesses as media-driven lifestyle businesses.
Likewise, software-based lifestyle businesses often include SAAS and mobile application development.
Why do lifestyle entrepreneurs typically earn their living from media, software, or some combination of the two?
As blogger, Pat Flynn, says,
In other words, businesses that leverage media and/or software are:
- efficient enough to generate a full-time income for the owner without employing anyone besides the owner and,
- flexible enough for the owner to work on them whenever and wherever there is an internet connection.
Lifestyle Business Examples that Leverage Media
Now that you know how lifestyle businesses work on a macro-level, let’s discuss some lifestyle business examples that leverage media to generate income.
Becoming an author is one of the oldest lifestyle business models.
Successful authors have built the lifestyle of their dreams as writers for hundreds of years.
Of course, today the internet allows for more ways than traditional publishing for an author to succeed.
E-book and Kindle opportunities are particularly interesting.
But, you actually don’t need to publish a book to succeed as an online author today.
There are several writers making a living publishing articles on Medium.
You can read more about becoming an author and how to pursue this lifestyle business in my article about solopreneur business ideas.
There are countless ways to monetize websites.
And you don’t need to have technical skills or be able to code to build a website.
Bloggers (who usually don’t code – they just write) can make a living simply publishing articles on their websites.
For instance, this list of blogger income reports shows plenty of bloggers making a living from their sites.
Some make money selling display advertisements on their blogs.
Others sell e-books or physical products.
You can also make money from a website by charging your readers to be part of a community.
This is what Jack Butcher does with his brand Visualize Value.
Butcher is also transparent with the profitability of his brand as you can see in the tweet below:
In short, websites provide their owners with a platform to sell almost anything to a captive audience.
If you don’t want to manage a website, there are certainly other opportunities to build a lifestyle business online.
Daniel Vassallo creates online courses and e-books, selling them on Gumroad and marketing them to his Twitter audience.
He’s transparent about how much he makes from his various e-books and courses as you can see in his below tweet.
Like Daniel, there are plenty of six-figure+ course creators making a living online while living their ideal lifestyles.
If you have specialized knowledge and a desire to teach, this could be a great lifestyle business opportunity for you.
Lifestyle Business Examples that Leverage Software
I’m less familiar with (but equally excited about) lifestyle businesses that leverage software.
And although I know there are more categories of lifestyle businesses than one that leverage software, I’ve found the most practical information about SAAS on the web.
So I’m just going to discuss SAAS for now.
Software As A Service might sound out of place on this list.
I’ve mentioned that services don’t usually make great lifestyle businesses.
However, the “Service” part of the term, Software As A Service, is a bit of a misnomer.
This sort of business actually functions more like a product-selling than a service-selling business.
As I mentioned in my article about solopreneurship ideas, the characteristics that usually define a SAAS business are:
- a web or cloud-hosted application like Google Drive or Dropbox with,
- customers paying monthly or annually for access to the application.
Of course, Google and DropBox are massive companies.
But there are plenty of “micro” SAAS opportunities for lifestyle entrepreneurs.
You can learn more about successful micro-SAAS companies on Indie Hackers here.
Lifestyle Business Disadvantages
So far, I’ve discussed some obvious advantages to lifestyle businesses like the freedom they can provide.
But do they have any disadvantages?
I think so.
I’ll discuss some of them in the next section.
A standard business is a better tool than a lifestyle business if you want to build a billion-dollar business.
If you want to build a business that generates billions in revenue and makes you a billionaire in the process, a lifestyle business likely isn’t the best way to do it.
None of the most profitable businesses in the world are lifestyle businesses.
And I don’t know of anyone who has become a billionaire as a result of a lifestyle business alone.
In short, I don’t think lifestyle businesses can be as profitable as regular businesses.
We’re in the early innings of the internet, so lifestyle businesses may mint billionaires in the future.
But I don’t think we’re there yet.
That said, there are plenty of lifestyle entrepreneur millionaires who have made millions from their businesses.
A standard business is a better tool than a lifestyle business if you want to radically change the world with your business.
World-changing businesses seem to require large teams, investors, and other aspects of business lifestyle entrepreneurs avoid.
So if you want to build a business in the field of:
- space exploration,
- green energy,
- autonomous electric vehicles,
- or other world-changing technology,
you will likely need a large team working together in a standard business setting.
Lifestyle businesses can take a long time to become profitable.
Nearly every media-leveraging lifestyle business I know of took years to become profitable, let alone earn a full-time income.
My wife posted to Instagram every day for a year before she earned any income as an influencer.
And she blogged for two years before she earned any income from her blog!
John Lee Dumas published a podcast episode every single day for 2,000 days (literally).
And he didn’t make a dime in the first nine months of publishing!
Software-leveraging lifestyle businesses may tend to become profitable more quickly than media-leveraging lifestyle businesses.
But, as I understand, the path to successful monetization of software-leveraging lifestyle businesses is less clear.
In short, be prepared to practice patience with whatever lifestyle business you pursue.
And don’t plan on relying on it as your primary source of income for several years.
Step One of Starting a Lifestyle Business in 2020
Step one of starting a lifestyle business in 2020 is to decide what sort of lifestyle business you want to build.
I recommend first considering whether you want to build a lifestyle business that mainly leverages media or software.
Keep in mind, you don’t need to know how to code to build software in 2020.
As I discuss in this article, there are plenty of no-code platforms that enable you to build whatever software you want, from web app, to mobile app, or game!
That said, if you aren’t familiar with no-code or consider yourself less technically inclined, a media-based lifestyle business might suit you better.
If you’ve settled on a media-leveraging lifestyle business, I recommend next considering what sort of content you can create most prolifically.
Like I said, John Lee Dumas published a podcast episode every day for 2,000 days!
My wife published a high-quality Instagram post nearly every day for two years (and counting)!
And almost every successful lifestyle entrepreneur I know of has needed a period of prolific creation usually at the beginning of their journey to succeed.
If you aren’t prolifically creating (at least at first), it’s unlikely you will be able to earn a living from your lifestyle business.
Next, check out my article on how to build a lifestyle business!
In the section above, I only mention step one of starting a lifestyle business.
The reality is that building a business is a complex, multi-step process!
But that’s exactly why I’ve started this blog – to hopefully clarify this process for anyone wanting to start a lifestyle business.
What else do you need help with in your lifestyle business journey?
I’d love to hear about it in the comments!